WCT aims to list REIT by year-end

> Real estate investment trust to start with 3 assets – Paradigm Mall, Aeon BBT and Premiere Hotel

KLANG: WCT Holdings Bhd aims to list its real estate investment trust (REIT) by end of this year, said its group managing director Datuk Lee Tuck Fook.

“We are in consultation with our investment bankers and the authorities. There are things we need to do to tidy up the assets before we can launch the REIT but that is the plan, to try and get everything done before end of the year,” he told reporters at its AGM yesterday.

He said it will not inject additional assets into the REIT before listing but it has the option to look for third party assets or other assets within the group post listing. The group plans to list the REIT with three properties namely Paradigm in Kelana Jaya and AEON BBT and Premiere Hotel in Klang.

According to a recent research report by Hong Leong Investment Bank (HLIB) Research, the three assets have a market value of RM1.1 billion and the REIT is expected to raise RM400 million.

Asked whether he will be involved in the REIT as a director, Lee said it is still in discussions and no decision has been made yet.

On its degearing exercise, which includes a share placement done in April and the sale and leaseback of The Ascent office tower to the Employees Provident Fund Board, Lee said its gearing level will be reduced to 0.6 times from 0.8 times now.

“We also expect the warrants, those that will be expiring come December, will be converted into shares. We are pushing with the sales of our property inventory and this plan of having the REIT, all these will basically bring our gearing level down,” he said.

Lee said it is confident of achieving its RM500 million property sales target this year based on the almost RM200 million in sales and bookings it has clinched so far since January.

“As far as property sales are concerned, we recognise the state of the market therefore we have repriced the properties, we are going to rebrand and relaunch them … profit margins will drop but that is something that we have considered and it is something that we are prepared to live with, because it means that we will be able to realise cash from the assets.

“We have to be realistic about where the market is today compared with what it was 12-18 months ago,” he added.

On the two state-owned enterprise contractors from China that WCT is partnering, deputy managing director Goh Chin Liong, who declined to identify the parties, said the partnership is to explore more on special building projects.

On whether WCT will consider merging with Malton Bhd to pursue bigger projects, Lee declined to comment, saying that it has not received any proposals to date.

Yesterday, shareholders approved the payment of a final single-tier share dividend on the basis of one treasury share for every 165 existing ordinary shares held in respect of the financial year ended Dec 31, 2016.